Securities Lawyers Blog
The law offices of Gana Weinstein LLP are investigating broker Paul Mauro (Mauro), currently associated with SagePoint Financial, Inc. (SagePoint Financial) out of Westborough, Massachusetts. According to a BrokerCheck report, Mauro has been subject to at least nine customer disputes, two regulatory actions, and one criminal matter during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), the customer complaints against Mauro concern allegations of unsuitable investment recommendations and misrepresentations.
In February 2018, as a result of Mauro’s disclosure incidents, the State of Massachusetts Securities Division placed conditions on Mauro’s registrations in Massachusetts and required him to be placed under heightened supervision by his brokerage firm.
In December 2018 a customer alleged that in 2017 Mauro unsuitably purchased variable annuity causing $6,630 in damages. The claim was denied.
In June 2017 a customer filed a complaint alleging that Mauro made unsuitable recommendations causing $86,000 in damages. The claim was denied.
Brokers are required under the securities laws to treat their clients fairly. This obligation includes the duties to disclose material risks of the investments they recommend and to present products, particularly complex or confusing products, in a fair and balanced manner that allows the client to evaluate the recommendation. Another important obligation advisors have is to make only suitable recommendations for investments to the client. There are many investments that are not appropriate for the majority of investors or for certain investors given their risk tolerance, age, and other factors. Advisors should not present these investment options to clients. There are two screens that advisors must employ to determine whether an investment is suitable for a client. First, there must be a reasonable basis for the recommendation – meaning that the product has been investigated and due diligence conducted into the investment’s features, benefits, risks, and other relevant factors. The advisor must conclude that the investment is suitable for at least some investors and some securities may be suitable for no one. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.
According to newsources, a study revealed that 7.3% of financial advisors had a customer complaint on their record when records from 2005 to 2015 were examined. Brokers must publicly disclose reportable events on their BrokerCheck reports that include customer complaints, IRS tax liens, judgments, investigations, terminations, and criminal cases. In addition, research has shown a disturbing pattern with troublesome brokers where brokers with high numbers of customer complaints are not kicked out of the industry but instead these brokers are sifted to lower quality brokerage firms with loose hiring practices and higher rates of customer complaints. These lower quality firms may average brokers with five times as many complaints as the industry average.
Mauro entered the securities industry in 1976. From June 2007 to November 2017, Mauro was registered with SII Investments, Inc. Since November 2017 Mauro has been associated with SagePoint Financial out of the firm’s Westborough, Massachusetts office location.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.